- EUR/USD breaks above the initial sideline trade.
- USD-selling is sustaining the squeeze higher in the pair.
- FOMC minutes next of relevance in the docket.
The upbeat tone around the shared currency has accelerated on the back of a moderate knee-jerk in the Greenback, lifting EUR/USD to the area of daily highs around 1.0980.
EUR/USD looks to US data, trade
After two consecutive daily pullbacks, the pair now looks to have resumed the upside following a bout of selling pressure in the buck on news regarding US-China visas.
In fact, the US Dollar Index has given away initial gains and returned to the area below the 99.00 handle, recording at the same time fresh daily lows and propping up the correction higher in spot.
In the meantime, investors remain vigilant on the imminent resumption of US-China trade talks in Washington (Thursday and Friday), as well as the key EU Summit next week with Brexit on top of the agenda.
Nothing scheduled in euro docket today, whereas all the attention will be on the publication of the FOMC minutes during the European evening.
What to look for around EUR
The pair is struggling to overcome the critical juncture at the 1.10 neighbourhood amidst alternating risk appetite trends. The resumption of the down trends is expected to pick up pace in tandem with the inability of the pair to surpass this area of resistance on a convincing fashion in the near term. In the meantime, the relentless slowdown in the region does nothing but justify the ‘looser for longer’ monetary stance by the ECB and the bearish view on the single currency in the next months. On another front, potential US tariffs on imports of EU cars remain well on the table, while the Brexit limbo and UK politics also adds to the current negative view.
EUR/USD levels to watch
At the moment, the pair is advancing 0.21% at 1.0979 and faces the next resistance at 1.1000 (monthly high Oct.7) followed by 1.1058 (55-day SMA) and finally 1.1109 (monthly high Sep.13). On the downside, a breakdown of 1.0879 (2019 low Oct.1) would target 1.0839 (monthly low May 11 2017) en route to 1.0569 (monthly low Apr.10 2017).
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